Covid-19: 'Weekend curfews, partial lockdowns hurting retail business'

Weekend curfews and partial lockdowns continue to hurt retail business and dampen consumer sentiment as many states still impose "irrational weekend lockdowns", the Retailers Association of India (RAI) said on Tuesday.

For retailers, over 45 per cent of the week's entire business happens over the weekends, RAI said in a statement. It added that after facing losses for over four months due to lockdown, retailers are depending on the weekend business to help recover from the financial stress they have been facing.

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"However, local authorities in some states continue to impose strict lockdowns on weekends, which are becoming a huge setback in their path to recovery," it added.

RAI said the Indian retail industry continues to struggle to get back to its feet with constant roadblocks being faced at the state and local levels with weekend curfews and partial lockdowns, which continue to hurt retail business and dampen consumer sentiment.

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"Over 10 states continue to impose irrational weekend lockdowns. These include Punjab, Haryana, Kerala, Madhya Pradesh, Uttar Pradesh, Jammu and Kashmir, and Nagaland, among others," the retailers' body said.

RAI Chief Executive Officer Kumar Rajagopalan said, "These are knee-jerk reactions that are crippling the sector and gravely affecting the economy. We have urged the Centre and the state governments to collaboratively work towards supporting the revival of the retail industry."

India will always be a consumption economy, and if the retail industry suffers, it will have a crippling effect on the entire value chain that involves manufacturing, entertainment, right down to artisans and other micro-enterprises, he added.

State-wise total number of confirmed cases, deaths

For retailers, nearly 60-70 per cent of costs are fixed costs, such as rents, and salaries to employees make a large part of this cost. This, along with low margins, leaves businesses with limited flexibility that has already started leading to layoffs and downscaling or even shutting down operations widely, Rajagopalan said.

"If the weekend business is lost then the hopeful recovery from the festive season will become a distant dream," he added.

RAI also said it is also grossly inconvenient to customers, who after a busy workweek wait for the weekend to do their shopping, especially in cases where both partners are working.

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"Partial closures and keeping shops closed during weekends are detrimental to social distancing as customers have no choice but to throng stores during restricted hours," it added.

In times like this when the business is inelastic, it is crucial to keep stores open on all days and for extended hours. Only this will help retailers crawl back from the financial distress they have been facing and encourage social distancing, RAI said.

The association also claimed that weekend and partial lockdowns continue despite orders from the Ministry of Home Affairs (MHA) to keep retail open on all days, suggesting a lack of coordination between the Centre and states.